Google Can’t Block Sales of Microsoft Products, U.S. Judge Rules

By Susan Decker -
Dec 3, 2012

Google Inc. (GOOG), which bought Motorola
Mobility to gain leverage in the global legal battle over
smartphone and tablet computer inventions, can’t use some of its
patents to block sales of Microsoft Corp. products, a federal
judge ruled.

U.S. District Judge James Robart in Seattle said in a Nov.
30 opinion that, because Motorola Mobility pledged to license
some patents on fair and reasonable terms, it can’t seek a court
order to halt sales of products that use those inventions. The
ruling applies to a group of Motorola Mobility patents that are
deemed essential to industry standards for video decoding and
Wi-Fi technologies.

“At all times during this litigation, the issue was not
if, but when and under what terms, a license agreement would be
established between Microsoft and Motorola,” Robart wrote in
the opinion. He ruled that Motorola Mobility won’t be harmed if
it can’t block the sale of products that comport with
industrywide specifications.

Niki Fenwick, a spokeswoman for Google, said the company
had no comment on the ruling. David Cuddy, a spokesman for
Microsoft, also declined to comment.

Mountain View, California-based Google spent $12.5 billion
to buy Motorola Mobility and cited its history of innovations
and patents on mobile phones as a key reason behind the
purchase. Google has cited Motorola Mobility’s patents to fight
back against patent-infringement claims by Microsoft and Apple
Inc. (AAPL) over devices running on Google’s Android operating system.

Licensing Terms

Robart’s ruling came in a breach-of-contract case brought
by Microsoft over Motorola Mobility’s licensing demands for the
Xbox video-gaming system and Microsoft Windows. Robart had
already ruled that Motorola Mobility had a contractual
obligation to license its standard-essential patents on fair
terms because it helped establish the standards.

A separate case in which Motorola Mobility is seeking to
block imports of the Xbox is scheduled to begin this week at the
U.S. International Trade Commission in Washington.

Two of the three patents in the ITC case relate to the
standard for video decoding that were the subject of Robart’s
decision.

Motorola Mobility had demanded a royalty of 2.25 percent of
the retail price of each product, a figure Microsoft called
excessive. The Redmond, Washington-based software maker has said
that would amount to $4 billion a year in royalties.

Essential Patents

Robart is evaluating testimony to determine a proper range
for reasonable royalties on patents that are incorporated into
standards designed to let products from different manufacturers
work together. His ruling, expected early next year, would form
the basis for a jury trial to determine whether Motorola
Mobility’s royalty demand violated its contractual commitments.

The judge had previously prevented Motorola Mobility from
seeking sales bans of Microsoft products in Germany based on
claims of infringement of standard-essential patents. That
decision was upheld by a U.S. appeals court in September.

Apple had also accused Google of violating its commitments.
That case, in a Wisconsin federal court, was thrown out after
Apple said it wouldn’t accept any rate set by the trial judge
that exceeded $1 per unit.

The U.S. Federal Trade Commission and the European Union
are investigating claims filed by Microsoft and Apple that
Motorola Mobility is misusing its patents to thwart competition.

The case is Microsoft Corp. (MSFT) v. Motorola Inc., 10cv1823,
U.S. District Court for the Western District of Washington
(Seattle).